New home starts hit all-time high
More new homes were started in the September quarter last year than at any time since records began in the mid-80s. The Australian Bureau of Statistics data reveals that there was a 12.5 per cent increase in new home starts to an all-time high of 52,380. The number of new detached home starts was up by 0.8 per cent but it was ‘other dwellings’, mainly multi-unit developments, where there was the largest surge up 30.2 per cent from the previous quarter. There was growth in all states with the exception of South Australia where activity fell by 5.7 per cent. Activity in New South Wales increased by 30.7 per cent, in Victoria by 0.9 per cent, in Queensland by 18.1 per cent, in Western Australia by 5.1 per cent, in Tasmania by 2.9 per cent, in the Northern Territory by 9.6 per cent and by 22.8 per cent in the ACT. The large jump in activity can be linked with the slowdown in the previous quarter; Shane Garrett, senior economist with the Housing Industry Association explains: “Following the surge in residential buildings approved in late 2013 and early 2014, there was a substantial accumulation of multi-unit residential building projects that had obtained approval but did not commence construction in the first half of the year. The figures released today confirm that much of the activity in the pipeline entered the construction phase in the September quarter.”
Optimistic outlook for the property market
A newly released report on business sentiment in the property market acknowledges a moderation of prices in many areas but is overall optimistic about the months ahead. The survey from ANZ and the Property Council shows a slight dip in confidence, but down just 3 points to 132; anything above 100 is in positive territory. The national poll was carried out in December and the general feeling is that there should be continued growth in both activity and prices this year although it will be at a more moderate level.
Capital city rents make home ownership even more attractive
Whether you are currently renting and looking to buy your own home or an investor building portfolio, new figures will make interesting reading. The vacancy rate in some capital cities is pushing rents upwards and in some cases are at record highs. The analysis from the Domain Group shows that nationally the capital city vacancy rates for houses was just 2 per cent in December with units at 3 per cent. The overall vacancy rate was 2.4 per cent. In Darwin tenants are paying twice that of those in Hobart and rents in Sydney continue to be sizeable. Brisbane and Melbourne have a better level of supply and are generally more affordable.
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